📚Partnerships and LLCs follow similar journal entry practices as other organizations, but with differences in net income division and dissolution.
💰A partner's investment in a partnership or LLC is recorded in a separate capital account.
👥Partnerships require a written agreement to determine how partners will divide income and losses.
⏰There are two methods for dividing partnership income: service-based and service and investment-based.
💼Partnerships make closing entries to distribute net income, including allowances for salaries and recorded as a division of net income.